Is it Legal and Ethical?
The until-now little-known scheme of refinancing school district bond debts for capital expenditure and refunding the difference to the districts known as “cash out” is being challenged in court by a local group, Citizens for School Bond Accountability, chaired by Jill B. Escher. They have exposed that the San Jose Unified School District is skimming the difference created by lowering interest rates through refinancing the 1997 Measure C bonds in 2005, earmarking the considerable sum of $20.4 million for new projects rather than returning it to the taxpayers.
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